Did you know that the value of condos has fared much better than single-family homes? The current housing market means there’s never been a better time to invest in condo associations as a form of real estate.
Unfortunately, the insurance situation surrounding condos can be a little confusing. Not only do the owners require individual condo insurance policies, but you’ll also want collective condo association insurance. But exactly why do you need this type of insurance?
What are the benefits that come with it? If you want to discover the answer to these questions, you’re in the perfect place.
This guide will teach you everything you need to know about purchasing condo association insurance.
What’s A Condo Association Insurance?
A typical condo association insurance policy covers the entire structure of a building as well as common areas. However, the association’s policy might or might not extend to your unit’s interior. It is critical to understand the things condo insurance covers and how it is different from the owner’s insurance policy.
It doesn’t matter how extensive your policy is; it can never cost each and every detail. Residents must have their personal condo insurance policy to keep their personal belongings protected. It also offers you liability coverage only when somebody gets injured inside your premises. On the other hand, a loss assessment policy pays damages exceeding your condo insurance policy.
Advantages Of Buying A Condo Association Insurance
Insurance covering the condo association is a master policy and covers a number of things. Although there are many benefits of this insurance, you are completely responsible for your personal unit. It is also important if you wish to rent out your condo anytime soon.
1. It Covers Repairs and Replacements
A condo association insurance policy can go a long way toward covering you when inevitable repairs and replacements are required. However, it’s important to note that the extent of the coverage will depend on the specific policy you go with.
For example, bare wall coverage will only cover the walls and flooring of a condo community. Original spec coverage expands this to include communal structures.
That being said, if you’re serious about protecting against repairs and replacements, you should get maximum coverage.
2. It Protects You From Lawsuits
There are likely a lot of different workers in your condo community at any given time. Office staff, groundskeepers, contractors, builders, and cleaners are just some of the people you’re likely to encounter.
If these individuals get hurt while working on the community condo property, you could be facing an expensive compensation lawsuit.
The workers’ comp section found in many condo association insurance policies can protect you from any potential lawsuits. They’ll also cover any medical expenses that might be required from your staff when they’re hurt.
3. Can Save You From the Unexpected
There can be a lot of unexpected damage to your condo coming from an unexpected place. Cybercrime is becoming increasingly commonplace in the real estate industry.
Similarly, dishonest employees might commit forgery, fraud, or other financial crimes. Then, there are things like flood and sewer backup that can destroy entire properties.
If you’re worried about these things, additional coverage on your condo insurance policy can help protect you from them.
Things That Are Covered Under This Insurance
Your condo insurance coverage takes care of all the public areas along with common amenities shared within your complex. Some insurance policies also go one step ahead by covering bare walls, insulation, and policy stops on your drywall.
In a condo association’s coverage, liability protection helps in covering the medical as well as legal costs. Particularly when the association experiences a lawsuit. For instance, when someone is injured due to falling or slipping at a place that the association maintains.
Next comes the property coverage, which aids in offering protection against perils in the building’s common area. You might share this common area with other people, such as the elevator, walkways, roof, courtyards, or basement.
Elevators, lobbies, hallways, and property outside the building- these are all instances of common areas. And your common condo insurance policy covers all this. Shared facilities like tennis courts and swimming pools are also covered under this insurance.
Is Condo Association Insurance The Same As Personal Condo Insurance?
No, a condo association coverage policy is completely different from an individual condo insurance. The latter is mostly purchased by an individual resident of a condominium complex.
Personal condo insurance is very similar to homeowner insurance, which safeguards the interior of the house. Further, it might also cover the cost of their belongings and liability costs.
You might assume that condo association insurance coverage includes everything outside your building. On the other hand, an individual condo policy only covers what’s inside the four walls.
Again, it is significant to remember that the scope of your condo association insurance coverage starts directly beyond the wall. Insulation, drywall, and studs are all parts of this coverage.
How to Find the Best Condo Association Insurance
The key to finding good condo insurance policies is to look for ones that include maximum coverage. The last thing you want is to think you’re covered.
Then, when something unexpected happens, you’re left high and dry. To avoid this, consider going with a condo association master insurance policy.
This type of comprehensive policy covers the entire property. This includes common areas, structures, and workers’ comp.
Appreciate Learning About Condo Association Insurance? Keep Exploring
We hope this guide helped you learn more about the benefits of purchasing condo association insurance. No one likes paying for condo insurance. But just because you don’t want to pay it, you shouldn’t overlook it.
However, the reality is that without this specific type, you’re left vulnerable to multiple threats within your condo community. As such, it’s best to bite the nail and invest in condo association insurance.
Want more real estate advice? Keep exploring our website to find more content you’re sure to connect with.